Credit card users stick to their own bank's ATMs

By Vanessa Tripodi

Like most Australians, you probably visit an ATM regularly, and it's not until the end of the month when your bank or credit card statement arrives that you see the accrued cost of your ATM transactions. These ATM withdrawal fees may be due, in part, to new regulations imposed in March 2009. Since March, using your credit or debit card at a rival bank's ATM has meant a $2 fee; this fee is applied not only to withdrawals but other actions, such as checking your account balance. However, the "foreign ATM" will also remind you of this fee before you confirm the transaction, so are Australians learning anything?

It would seem that they are because in the six months since September 2009, Reserve Bank of Australia (RBA) research found there has been a 5 per cent increase in credit and debit card customers who will use their own bank's ATM. Where previously 60 per cent of Australians would seek their own bank's ATM, that number is now approximately 65 per cent, thanks to the new direct-charging rules. Another report released earlier in 2009 showed that Australians are paying $1.15 billion in avoidable bank and credit card fees. With the growing awareness of such fees and everyone attempting to watch their bottom line, being told at the time of a transaction about an additional fee allows Australians to keep their fees in check.

The implementation of the $2 fee and the option to cancel the transaction to avoid a foreign ATM fee are part of the RBA's plan to improve the transparency of transaction fees. Though fees would previously be hidden in the minutia of information on your monthly statement, or you simply didn't read your statement to reconcile your ATM use, Australian debit and credit card customers can now easily make more responsible decisions about their spending.

To help you avoid foreign ATM fees, many banks and financial institutions have a text message system to direct you to their closest ATM. Your bank or credit card provider can supply the number you need and you simply message them the suburb and postcode you are in at the time. They then message you back directions to a friendly ATM. When you compare the 25 cent message fee to a string of $2 rival ATM fees, you'll want to contact your bank now for the number of their text message service. Alternatively, some banks and financial institutions have their ATM locations listed on their Web site, where you can do an area search and plan your day's spending.

Of course, in simply avoiding foreign ATM fees, you may still be faced with withdrawal fees from your own bank for excessive ATM use. Therefore, you may want to change your account to one that better suits your spending habits, or simply plan your purchases and withdraw more money at each ATM visit, or use the "cash out" option when you pay for something with EFTPOS.

So, there is really very little that you have to remember to save yourself from a foreign ATM fee. As a nice change the banks are offering transparent advice and services to their credit and debit card customers.

Article by Vanessa Tripodi

Published: September 25, 2009